Sweetheart Tax Deal A Boon to Paulson

Hank Paulson may be taking a big pay cut when he moves from New York to Washington, but he’ll also be getting a sweetheart deal from the IRS that’s sure to lessen the blow. The tax code lets government workers defer capital gains taxes on assets they have to sell to avoid a conflict of interest--the only catch is that the proceeds are reinvested in government securities or a broad array of mutual funds approved by the government within 60 days. Theoretically, if Paulson holds his replacement assets til death, he’d never have to pay capital gains. The chance to save $100 million or so in taxes must have figured into the guy’s decision to take the post.
Loophole for Poor Mr. Paulson [Forbes]

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